Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: You're listening to Bloomberg Business Week with Carol Masser and
Speaker 2: tim Stenoveek on Bloomberg Radio.
Speaker 3: Hey, we want to get to a story. Do you
Speaker 3: watch YouTube a lot?
Speaker 2: I actually do. I feel like it's so easy to
Speaker 2: just continue to go down rabbit holes of all the
Speaker 2: things that you watch one thing, another video will come up,
Speaker 2: and it just I probably spend too much time.
Speaker 3: We have dedicated channels that we definitely go to. We
Speaker 3: Saiale and we watch some of the sailors that are
Speaker 3: going around the globe. So we like we'll like tune
Speaker 3: in every week or two weeks when they've got a
Speaker 3: new episode. Got to keep in mind YouTube, I've spent
Speaker 3: the past few years trying to make itself the centerpiece
Speaker 3: of the living room. For two decades, it has tried
Speaker 3: to convince advertisers that it's the future of entertainment. It
Speaker 3: has had some problems making that case. So rights our
Speaker 3: own Lucas Shaw. We want to head to our la
Speaker 3: bureau for Bloomberg News and Bloomberg News Managing Editor, Media
Speaker 3: and Entertainment head Lucas Shaw. He's really the ringleader, I
Speaker 3: should say behind our Bloomberg screen time coverage and vertical
Speaker 3: as well. Hey Lucas, good to check.
Speaker 1: In with you.
Speaker 3: Great story. YouTube. It feels like it's I don't know,
Speaker 3: I feel like everybody's talking about it. It's coming into
Speaker 3: its own what's going on and is kind of everybody
Speaker 3: talking about it with good reason.
Speaker 1: Well, I'd say everyone in Hollywood is paying more attention
Speaker 1: to it than they used to be. You know, it's
Speaker 1: funny to talk about YouTube as anything new, right, It's
Speaker 1: been around for twenty years as of this year. It's
Speaker 1: been widely popular for at least a decade, if not longer.
Speaker 1: You know, it's the most popular music service in most
Speaker 1: of the world. It's become a very popular platform for podcasting.
Speaker 1: You know, it's where people essentially watch late night. It's
Speaker 1: the new home of all I use it for yoga.
Speaker 1: But I think that what's really happened over the last
Speaker 1: couple of years is twofold one is it's just as
Speaker 1: traditional entertainment has gotten more challenge and as the TV
Speaker 1: business has shrunk, advertisers have looked to YouTube as the
Speaker 1: future and started to spend more and more money there.
Speaker 1: Creators who have been there for a long time have
Speaker 1: started to build businesses and been able to raise real capital.
Speaker 1: And then I think data also does play a real
Speaker 1: role here where Nielsen puts out these monthly reports on
Speaker 1: how much people how much time people are spending watching
Speaker 1: a given streaming service on television, and YouTube has gone
Speaker 1: from being already number two behind Netflix now being the
Speaker 1: unequivocal number one. People spend more time watching YouTube on
Speaker 1: a television than everything Disney owns, that's streaming, that's TV networks,
Speaker 1: and I think that has really reinforced for people in entertainment, like,
Speaker 1: holy crap, YouTube is really big, and we need to
Speaker 1: look at this again.
Speaker 2: What do we know as far as behind Alphabet's efforts
Speaker 2: when it comes to streaming When you think about other rivals,
Speaker 2: say like Amazon with Amazon Prime and the streaming services
Speaker 2: that they have. When you're mentioning obviously Netflix two.
Speaker 1: Here, well, look, YouTube is just is lead and bounds
Speaker 1: bigger than what any of the other tech companies have,
Speaker 1: right Apple, Apple and Amazon have their own streaming services.
Speaker 1: Apples is very niche, Amazon's is pretty big, but still
Speaker 1: much smaller. Both of them view themselves, I think primarily
Speaker 1: as homes and retailers for other people's wares. Right, like
Speaker 1: Amazon is a it's core a retailer. It wants to
Speaker 1: sell everyone else's streaming service. Apple would wanted to make
Speaker 1: its TV app at the place where you could come
Speaker 1: and find everything. The challenge that a lot of them
Speaker 1: ran into as a company like Netflix was like, I
Speaker 1: don't want to collaborate with you on this. I'm trying
Speaker 1: to become the place that everybody goes. You know, YouTube
Speaker 1: has aspects of it being this destination.
Speaker 2: Right.
Speaker 1: They sell the live TV service YouTube TV. You can
Speaker 1: pay for paid streaming services and stream them within YouTube.
Speaker 1: There are a lot of other things you can do
Speaker 1: besides watch core YouTube. But it has the biggest advantage
Speaker 1: of all, which is it has just YouTube, and so
Speaker 1: many people already hum for that, and it becomes a
Speaker 1: natural hub to direct them to all these other things.
Speaker 3: So I'm going to ask you, Lucas our Sebastian Escobar
Speaker 3: is just saying YouTube premium like kind of changed his life,
Speaker 3: changed his mind. He said, it's like nineteen dollars a month,
Speaker 3: a bit pricey, but no ads. I mean, is that
Speaker 3: where they're making their money or do they need to
Speaker 3: be providing content that advertisers want to advertise with.
Speaker 1: Well, look, YouTube still makes the majority of its money
Speaker 1: from advertising. You know, I think last year it was
Speaker 1: I'm going to say it's about thirty five billion, but
Speaker 1: don't hold it to that. Maybe it was a little lower,
Speaker 1: Maybe it was closer to thirty Subscription wise, the outside
Speaker 1: estimates now say the YouTube business is probably fifteen to
Speaker 1: twenty billion. That's also massive, it's not as big as advertising.
Speaker 1: That's the mix of YouTube TV, the YouTube premium. I
Speaker 1: think YouTube premium is great for certain people, and the
Speaker 1: music service has also is a big lore. You know,
Speaker 1: YouTube has become one of the bigger paid music services
Speaker 1: on top of being free. But it's still that's like
Speaker 1: the nice growth area and something they're putting a lot
Speaker 1: of effort into. But YouTube is a division of Alphabet.
Speaker 1: Alphabet makes most of its money from advertising. I don't
Speaker 1: think that's going to change anytime soon. But they want
Speaker 1: to have a little bit of everything. And you know,
Speaker 1: there's the quality of programming that you see on YouTube,
Speaker 1: I think is getting better each year. And that's one
Speaker 1: of the things that I tried to get at is
Speaker 1: there's always been this perception of YouTube as sort of
Speaker 1: a home for lower quality smut, and there's some of
Speaker 1: that still. There's a lot of that still there. Right,
Speaker 1: It's sort of an inexhaustible amount of video that you
Speaker 1: can watch on YouTube, but the stuff at the top
Speaker 1: end is starting to rival what you could see on TV.
Speaker 2: How are Hollywood executives trying to jump in on this?
Speaker 1: Well, so there's a long and checkered history of Hollywood
Speaker 1: and YouTube in that. About ten years ago, maybe twelve
Speaker 1: years ago, there was sort of an initial rush of investment,
Speaker 1: and Hollywood companies invested in all these companies called multi
Speaker 1: channel networks. There were loose confederations of channels where they
Speaker 1: the company itself didn't really own anything. They did a
Speaker 1: lot of business like ad sales or distribution on behalf
Speaker 1: of the channels. Turns out those were not very good businesses.
Speaker 1: But Disney spent a bunch of money on one, Framework's
Speaker 1: Animation bought one, Warner Brothers bought one or two. Now
Speaker 1: I think they're looking at that again, but trying to
Speaker 1: be smarter about how they go about it. So that
Speaker 1: can be either in kind of taking just licensing existing shows. Right,
Speaker 1: So Netflix has Coco Melon, they have Miss Rachel, they
Speaker 1: have the Sidemen, Amazon has a big show with Mister Beast,
Speaker 1: and that's essentially paying these people to bring what's already
Speaker 1: popular over to them. Or they may invest in some
Speaker 1: of these companies or try to strike deals, and those
Speaker 1: haven't happened yet, but I think they probably will at
Speaker 1: some point. You'll see an effort to kind of buy
Speaker 1: someone who has brands or properties that might work.
Speaker 3: Yeah, it's just kind of fascinating. I guess, you know,
Speaker 3: does it bottom Lucas? I mean, going forward, do they
Speaker 3: want to have I'm assuming the majority of their content,
Speaker 3: you know, produced well, or do they like this idea
Speaker 3: that there's like kind of anybody can create a YouTube
Speaker 3: channel and put some content.
Speaker 1: Up there in they in that case is YouTube.
Speaker 3: Well I'm thinking about Yeah, like I guess YouTube creating,
Speaker 3: I guess their own content. It sounds like they want
Speaker 3: to kind of up the quality of it, but I
Speaker 3: just feel like there's just so many other people do
Speaker 3: it too, and some of it's really good, some of
Speaker 3: it's not.
Speaker 1: I don't think YouTube wants to finance a lot of
Speaker 1: its own programming. That could change, but they have dabbled
Speaker 1: in that over the years and it hasn't gone very well.
Speaker 1: And I think they much prefer being this neutral distributor
Speaker 1: and being a platform where people can upload anything, and
Speaker 1: they might invest or put money behind certain areas where
Speaker 1: they want to push people. But they have alphabet, Google,
Speaker 1: YouTube and any part of that. Glasses has never shown
Speaker 1: a ton of interest in being a proper studio in
Speaker 1: the same way that Amazon and Apple are now. Now
Speaker 1: that could change. Someone made a good point to me
Speaker 1: the other day, which is like, if you're them and
Speaker 1: you want to be ahead and AI, would you want
Speaker 1: to buy a big studio and use that copyright to
Speaker 1: train your video model. Maybe, But to date, funding entertainment
Speaker 1: or kind of directly funding production has not been something
Speaker 1: that YouTube is liked the lot.
Speaker 3: All right, Well, it's such a great deep dive, and
Speaker 3: I just feel like we are increasingly when we're talking about,
Speaker 3: like where everybody's watching, we are talking so much about YouTube. Lucas,
Speaker 3: thank you as always really appreciated. Chris Bloomberg, News Managing Editor,
Speaker 3: Media and Entertainment. Lucas Shaw. Check out his story. It's
Speaker 3: in the weekend addition two of Bloomberg Business Week, and
Speaker 3: you can check it out and read a little bit more.
Speaker 3: In terms of details, there's some great. I mean, I
Speaker 3: think Lucas touched on it. But according to Nielsen, an
Speaker 3: average of more than seven million people in the US
Speaker 3: are watching YouTube Tube on a TV at any given time,
Speaker 3: more than watching Netflix and Amazon Prime Video combined. Fastest
Speaker 3: growing audience being viewers sixty five and over. I don't know,
Speaker 3: it's just kind of wrong. We watched it a lot
Speaker 3: in our hassole. Yeah,